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Online sales up 517% at GameStop, though overall sales are still on a decline

GameStop's Q1 financials include a look at how the company has weathered the months in which COVID-19 hit the United States and altered how physical shops do business.

GameStop has seen its online sales jump significantly during the past few months as the COVID-19 pandemic limits physical store operations, but net sales across all categories are still down year-over-year during a complicated chapter of GameStop’s saga.

According to the company’s quarterly reports, Q1 saw 90 percent of GameStop’s US locations close temporarily due to state-by-state pandemic responses (and despite its earlier cries to be labeled an essential business). As of the end of May, 85 percent of stores are now open to limited customer access or curbside delivery.

During the quarter ending May 2, 2020, GameStop reported a 519 percent increase in ecommerce sales versus the same period last year, but ultimately sales as a whole are still down year-over-year.

For Q1, GameStop reported net sales of $1.02 billion, down from last year’s $1.55 billion, and an operating loss of $108 million, down from last year’s operating earnings of $17.5 million.

With its heavily ecommerce-based quarter, software took the biggest hit in terms of sales for the quarter (though, as GameStop will usually point out, there is a somewhat of a natural decline to be expected as the next generation draws near). For a category by category look at net sales, GameStop saw $513.1 million in hardware and accessory sales (down from $656.5 million), $417 million in software sales (down from $733.1 million), and $90.9 million in collectable sales (down from $158.1 million).

“As we begin the second quarter, we are cautiously and prudently navigating the near-term, as we are operating in the last few months of the current generation console cycle and believe we have experienced a pull forward in demand for end-of-life inventory given a surge in gaming product demand following the global stay-at-home orders,” reads a statement from GameStop CEO George Sherman. “That said, we believe the performance we achieved despite multiple headwinds is further evidence of the power of GameStop and the advantages that we possess driven by our global footprint, knowledgeable sales associates and strong loyalty base."

Like many others, GameStop isn't offering an exact prediction for either Q2 or the 2020 financial year as a whole due to uncertainty that comes from operating during a pandemic. 

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